Onsite Coverage: Warren Asks CUs to Support CFPB and Cordray on Capitol Hill

WASHINGTON — During her morning session at CUNA’s Government Affairs Conference, Sen. Elizabeth Warren (D-Mass.) asked credit unions to advocate for the Consumer Financial Protection Bureau and the confirmation of Richard Cordray while hiking the hill later Wednesday.

Warren also warned that the alternative to the CFPB’s rules would not include exceptions or safe harbors for credit unions.

“There are the more complex automatic default rules of Dodd-Frank, the risk of more litigation, the possibility of a free pass for the unregulated non-depository financial institutions,” the newly elected senator said, describing what would happen should the CFPB be eliminated.

“We are back to automatic default Dodd-Frank rules that, unlike the QM ones, lack the exemptions for small financial institutions. I hope you listened closely to that: back to Dodd-Frank default rules that lack exemptions for small financial institutions,” Warren said.

The Senate Banking Committee member, considered a founder of the CFPB, urged credit unions to use their political clout to tell members of Congress to “stop re-litigating settled decisions,” a nod to a recent District of Columbia appeals court ruling that declared President Obama’s National Labor Relations Board appointments unconstitutional.

The ruling could set a precedent for another lawsuit in the same court that challenges Cordray’s appointment and the Dodd-Frank Act.

“(It’s) time to confirm a director so the CFPB can create a safe harbor for your work so you can go about the business of serving your members. It's time to move forward,” Warren said. Warren called Cordray a “stellar director” who has won praise from consumer and industry groups for his balanced and measured approach to rulemaking. She added that she doesn’t know how anyone could still be concerned that the CFPB would be an overly aggressive regulator.

“Rich has been providing balance, creating space for credit unions and other small financial institutions to run their businesses and serve their customers without drowning them in regulations,” she said